Category Archives: Abandoned Housing Projects

Scheme of Arrangement (SOA) in the Rehabilitation of Abandoned Housing Projects: A Case Study of Malaysia

Md Dahlan, Nuarrual Hilal (2013) Scheme of arrangement (SOA) in the rehabilitation of abandoned housing projects: A case study Of Malaysia. Asian Studies International Journal, 1 (1). pp. 36-53. ISSN 2279-1949

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Abstract

If a company is insolvent and is unable to pay its debts, it may be subject to a scheme of arrangement (SOA) on the application of the creditors or members or the liquidator or the company itself. The usual purpose of SOA is for the SOA manager to take over the affairs and business of a debtor insolvent company in order to settle off the debts of the creditors and once all the debts are fully paid, the control of the debtor insolvent company will be handed over back to the previous management. The SOA manager is armed with certain powers and duties in the SOA administration. The benefit of obtaining SOA is to give some time to the SOA manager to run the debtor insolvent company in order to settle its debts. Moratorium power will be given to SOA Manager against any actions and proceedings by the creditors in the course of the SOA administration. This moratorium power is to allow the SOA manager to exercise the SOA effectively without any interference by the creditors and the members of the debtor insolvent company. In respect of insolvent housing developer company which becomes subject to SOA, similar duties are carried out by the appointed SOA manager, viz to take over the affairs of the company, to settle off all the debts of the creditors, to carry on any project and business left by the company if this is expedient in accordance with the law and the wish of the creditors or the members. Once all these have been dispensed with, the affairs and management of the company will be handed back to the previous management.

Keywords: Scheme of Arrangement (SOA); Insolvency Administration; Rehabilitation; Abandoned Housing Projects; Grievances of Purchaser.

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Shariah and legal issues in house buying in Malaysia: The legality of Bay’Bithaman-Al-Ajil(‘BBA’) with special reference to abandoned housing projects

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Md Dahlan, Nuarrual Hilal and Syed Abdul Kader, Sharifah Zubaidah (2011) Shariah and legal issues in house buying in Malaysia: The legality of Bay’ Bithaman al-Ajil(‘BBA’) with special reference to abandoned housing projects. Pertanika Journal of Social Sciences & Humanities , 19 (2). pp. 349-361. ISSN 0128-7702

Abstract

The primary duties of Islamic banks and financial institutions in Malaysia are to carry out Islamic banking and financial activities and to offer products that are in accordance with the Islamic teachings. These products are subject to the scrutiny and approval of Bank Negara’s Shariah Advisory Council (SAC) and the internal Shariah Advisory Bodies (SAB) or the Shariah Committees of the respective financial institutions.Despite having been in existence for more than 25 years, in the authors’ view, it is still questionable whether or not the Islamic banks and financial institutions in Malaysia have been satisfactorily carrying out these duties. One area worth examining is the transaction involving house buying, particularly the one that falls under the purview of the Housing Development (Control and Licensing) Act 1966 (Act 118) and transactions involving houses pending completion. This paper examines this area of transaction and the loan agreement, affected via Bay’ Bithaman al-Ajil (BBA), provided by Islamic banking and financial institutions in Malaysia.The purpose is to see to what extent the sale and purchase agreement and the loan agreement have complied with the requirements of the Islamic Law in protecting stakeholders and to provide practical suggestions to improve the existing practice.The paper concludes that the current practice of the BBA contradicts with the teachings of Islam and should therefore be modified and revamped until it is fully able to protect the interests of the purchasers/borrowers.

Keywords: Bay’ Bithaman al-Ajil, Gharar al-Fahish, Islamic Banking Law, abandoned housing projects, Malaysia

Comparative legal analysis between the rehabilitations of the failed residential projects of the liquidated housing developer companies in Malaysia and the Republic of Singapore

Md Dahlan, Nuarrual Hilal (2012) Comparative legal analysis between the rehabilitations of the failed residential projects of the liquidated housing developer companies in Malaysia and the Republic of Singapore. Journal for Global Business Advancement, 5 (2). pp. 126-149. ISSN 1746-966X

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Abstract

This paper discusses the liquidation law and practice in the rehabilitation of failed residential projects in Malaysia of the liquidated housing developer companies in comparison with the position in the Republic of Singapore.This paper is the fruit of a legal case studies research funded by the Ministry of High Education Malaysia (MOHE) through the FRGS Grant. The objective of this paper is to highlight the problems in the current liquidation laws applicable in Malaysia and Singapore in the face of the failed residential projects’ problems and the grievances of the purchasers. This paper suggests that there are lacunae in the current law of liquidation and insolvency in Malaysia and Singapore in dealing with the rehabilitation of failed residential projects for protecting the rights of the aggrieved purchasers. This paper also proposes solutions for the lacunae and the problems.

Keywords: liquidation law issues; failed residential projects; rehabilitation; liquidation of housing developer companies; Malaysia; Republic of Singapore.

Issues of Khiyar (option) in housing agreements in Peninsular Malaysia

lestari30Md Dahlan, Nuarrual Hilal (2014) Issues of Khiyar (option) in housing agreements in Peninsular Malaysia. Malayan Law Journal, 1. pp. 1-21. ISSN 0025-1283

Abstract

It is well entrenched in lslamic Law that khiyar is an inherent right of the contracting parties in a contract.This right provides the contracting parties with a right of option to void the contract they entered into if the subject matter of the contract does not comply with the specifications, terms and conditions of the contract.In Peninsular Malaysia, all house purchasers who wish to buy houses built by the licensed housing developers who are subject to the Housing Development (Control and Licensing) Act 1966 (Act 118) and subject to the control of the Ministry of Housing and Local Government (MHLG) are required to use the prescribed housing statutory standard sale and purchase agreements as contained in Schedules G, H, I and J (‘the said agreements’). However after close scrutiny over the said agreements, there is no term of khiyar provided.  Thus, due to the absence of term of khiyar in the said agreements, the said agreements, it is submitted, are null and void under lslamic Law. Likewise, it follows that due to this nullity, the subsequent housing transactions involving loan agreements, effected through Bai’ Bithaman al-Ajil (BBA), Musharakah Mutanaqisah, ljarah Thamma al-Bay’ and Istisna’ used by lslamic banks, may also be affected and are void.This academic paper is a fruit of a completed research undertaken by the author.Its objective is to discuss and explore the issues of khiyar in the said agreements, particularly when the housing projects are abandoned.The author used qualitative legal research methodology to unravel the issues of khiyar in the said agreements.This paper contends that due to the absence of khiyar in the said agreements, the said agreements have not complied with the requirements under lslamic law and could cause the housing transactions and the subsequent loan transactions entered into by the purchasers/borrower, developers and lslamic banks, void too.This paper also provides certain proposals to improve the current terms and conditions in the said agreements in order to render them harmonious with the spirit and intent of lslamic law.

Keywords: khiyar; housing statutory standard sale and purchase agreements; abandoned housing projects in Peninsular Malaysia; housing law in Peninsular Malaysia; lslamic law.

Issues in the statutory housing sale agreements in Peninsular Malaysia: A case study of abandoned housing projects

Md Dahlan, Nuarrual Hilal (2015) Issues in the statutory housing sale agreements in Peninsular Malaysia: A case study of abandoned housing projects. The Law Review. pp. 377-397. ISSN 1985-0891

Abstract

The use of statutory housing sale agreements (“the said agreements”) as enshrined in the Housing Development (Control and Licensing) Regulations 1989 is mandatory for all housing developers in Peninsular Malaysia.The use of the said agreements is to ensure protection to house purchasers against irresponsible housing developers.However, in practice, it is evident that the terms of the said agreements are inadequate to provide purchasers with the required protection particularly in abandoned housing projects. This paper aims to highlight this issue.This paper is also the fruit of a research exercise using legal research and qualitative case study methodologies. It finds that there are certain lacunae in the terms of the said agreements that have caused the said agreements’ inability to face the problems of abandoned housing projects to the detriment of the house purchasers’ rights.Further, there are certain housing transaction practices that have caused grievances to the house purchasers. The author provides, at the ending part of this paper, some proposals to overcome the highlighted problems.This is a part of the initiatives to strengthen the said agreements to become more protective to house purchasers.

Keywords: Statutory housing sale agreement, issues, abandoned housing projects, Peninsular Malaysia, grievances to purchasers.

Issues in the Malaysian statutory housing agreements (Schedules G, H, I and J): “Defect Liability Period”

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Md Dahlan, Nuarrual Hilal (2015) Issues in the Malaysian statutory housing agreements (Schedules G, H, I and J): “Defect Liability Period”. The Law Review (2). pp. 254-273. ISSN 1985-0891

Abstract

Defect liability period clause is provided in the statutory housing agreements-Schedules G, H, I and J (“the said agreements”). However, this liability may not be provided if the housing project is abandoned. Thus, in the event of housing abandonment, the purchasers may not be able to get protection under defect liability period clause. Due to this lacuna, the rights of purchasers can be undermined. This paper aims to highlight this issue-defect liability period in the said agreements, particularly involving abandoned housing projects in Malaysia. This research paper used a pure legal research methodology.This paper finds that due to the absence of specific clause of defect liability period in the said agreements in the event of housing abandonment, the rights of the purchasers will be denied and they will suffer irreparable damage. At the ending part of this paper, the author suggests some recommendations to settle the issues identified.

Keywords: Abandoned Housing Projects in Malaysia, Defect Liability Period, Statutory Housing Agreements, Legal Issues, Purchasers’ Grievances, Recommendations.

Comparative legal analysis on the viability of judicial management on insolvent residential developer companies in Malaysia, The Republic of Singapore and The United Kingdom

Md Dahlan, Nuarrual Hilal (2015) Comparative legal analysis on the the viability of judical management on insolvent residential developer companies in Malaysia, The Republic of Singapore and The United Kingdom. Malayan Law Journal, 2 (20). pp. 1-15. ISSN 0025-1283

Abstract

Recently, the corporate law reform committee (‘CLRC’) operating under the companies commission of Malaysia (‘CCM’) has recommended that judicial management (‘JM’) be introduced in Malaysia as one of the ways to deal with corporate insolvency matters. The application for appointment of judicial manager may be made by the company itself, the directors or the creditors. The judicial manager is armed with a moratorium power against any action taken which may be commenced by the creditors and others to ensure that he can effectively carry out his duty. The moratorium power will enable him to prepare and implement the approved restructuring plan for the benefits of the insolvent company and its creditors.This paper aims to elaborate the CLRC’s recommendations on JM and study its strengths and weaknesses particularly in dealing with the problems of failed residential projects of insolvent residential developer companies. This paper is also a result of research conducted through a comparative legal research methodology. Two jurisdictions, viz the Republic of Singapore and the United Kingdom have been selected for comparative analysis over their respective laws and practices on JM. Further, this comparative study is to investigate, identify and find the respective jurisdictions’ strengths and weaknesses on JM, which Malaysia can learn from particularly in the face of the failed residential projects’ problems. This paper finds that the recommendation by the CLRC for the appointment of judicial manager is commendable. Nonetheless, it is submitted that, in the insolvency management of insolvent residential developer companies with failed residential projects, the judicial manager who is armed with certain statutory and legal powers still cannot fully provide comprehensive solution in dealing with the rehabilitation of failed residential projects and cater to the rights of the aggrieved purchasers. Equally, this paper suggests certain proposals to improve the corporate rehabilitation mechanism carried out by the judicial manager in insolvency Administration involving insolvent residential developer companies whose residential projects failed.In the course of carrying the JM, this paper also suggests certain ideas on how to protect the rights and interests of the aggrieved purchasers in failed residential projects.

Keywords: Failed Residential Projects; Judicial Management (‘JM’); Rights of Aggrieved Purchasers; Rehabilitation; Malaysia.

Some drawbacks in the Australian Buying Off the Plan

Buying off the plan means buying property with the advance of some deposit (usually at 10% of the purchase price), while the remaining 90% will be paid after the developer completes constructing the property together with the necessary certificate of completion/fitness which warrants delivery of vacant possession and occupation. This can protect purchasers against losses due to incomplete project or abandoned property project.

Nonetheless, there are some drawbacks of this plan. This is revealed in an article entitled “in Asking the right questions pays off when buying off the plan” appeared in Herald Sun written by Neelima Choahan in Herald Sun Real Estate – http://www.heraldsun.com.au/realestate/news/asking-the-right-questions-pays-off-when-buying-off-the-plan/story-fni0ckoj-1226910382891.

“New data from property consultants Charter Keck Cramer reveals the number of off the plan apartment releases soared 103 per cent from just over 7000 to more than 14,000 between 2009 and 2013. But the biggest gains have been in the outer suburbs of Melbourne where off the plan releases increased a whopping 2350 per cent from 42 to 1029 apartments, a whopping 2350 per cent jump.”

Charter Keck Cramer director Sam Nathan said Melbourne’s apartment sector had matured significantly in the past five years.

“Melbourne’s favourable planning strategy, dynamic private development sector and supply opportunities have driven the new releases,” Mr Nathan said.

However, he said the apartment market in the city fringe, inner and middle regions was still in its infancy.

Property group 360° director John Meagher said buying off the plan held a lot of financial advantages for well-informed buyers.

But for the uninformed there were many hazards that could turn the expectation of a great investment into a financial and emotional headache.

“Buying off the plan is a literal term for purchasing property that has not yet been built,” Mr Meagher said.

“In other words, it is making a decision to buy an apartment or house based on the documentation available prior to construction.”

Mr Meagher, who has just released a guide to buying off the plan, said buyers must consider the financial, technical and legal requirements before signing on the dotted line.
“Buyers should ask how much deposit needs to be paid, when the balance of purchase price is due to be paid under the contract of sale,” he said.

Mr Meagher said buyers in Victoria should investigate how much stamp duty they would have to pay on settlement.They should also find out the due date for payment and the sunset clause, Mr Meagher said.

“The sunset clause is the date by which the developer has to deliver the property to the purchasers,” he said.

“If the developer doesn’t deliver the property within the timeline, the purchaser is entitled to a reimbursement of the deposit and can walk away from the contract of sale. Alarm bells should ring if the sunset clause is too long.”

Being aware of important technical information when buying off the plan made all the difference between a good and bad investment, he said.

“Some agents will quote room sizes using measurements taken to the exterior of the building,” Mr Meagher said.

Other things to look out for were high rental guarantees used to set prices above market value and if car parking and air conditioning were included in the price.

Remember to ask the question, ‘What is included in this price?’, he said. “Don’t always assume you are buying what you see in the developers’ sales centre or brochure,” Mr Meagher warned. “Additional priced upgrades may be shown in the display.”

Buyers should check the developer’s background, obtain proof of progress and keep the contract handy during final inspection to double-check before settlement.

He urged buyers to go with experience. “You don’t want to be guinea pig, buying in a development where the developer is going through the processes for the first time and learning at your expense,” he said.

“The bottom line is you can never ask too many questions or have too much information about a property you are interested in buying.”

Practical planning pays off

BEFORE buying her new off-the-plan apartment, Euphie Rong made sure she asked all the right questions.

Despite that, the end product wasn’t quite what the financial markets client specialist imagined.

In fact, the one-bedroom abode in the CBD surpassed all her expectations.

“Thankfully, it was even better than my expectations,” Ms Rong said. “It has very good views of the city and lots of sunlight.”

Ms Rong, who has entered into the off-the-plan market for the first time, said doing her homework was the key to success.

“I looked at the plan carefully and I got as much information as I could,” she said.

“I also researched the developer and the builder to see what their track record was in terms of delivering on time and the quality of their project.”

Ms Rong also compared the established one-bedroom apartments in the CBD on offer before making her choice.

She said buyers should consider the “hard” and “soft” elements of the development before making a decision. “The hard (elements) are the construction, the quality, the material, the location — so the property itself,” Ms Rong said.

“The soft (elements) are the pricing and your own requirements.”

“No one knows the project 100 per cent — either the sales person or the project manager. But if you ask the questions, you’ll get the answers.”

Email on issue of rehabilitation of abandoned housing project by liquidator

The email reads as follows:

Assalamualaikum

I have read many articles from you blog with regards to abandoned housing development. I am writing to seek your advice regarding my situation and also on behalf of the to other purchasers.

If you don’t mind, let me explain the brief story. We bought a semi D house in mukim … in 2008. There are only 10 houses in the development called taman … and the developer was …. Subsequently the developer was liquidated and …. has been appointed as the liquidator. At this juncture the houses were completed up to 75% except for electrical , water pump house and roadwork.

It has been more than a year but the liquidator has not made any progress. Latest news we heard that the liquidator is now  applying to the court for a scheme to revive development but with the condition that we need to top up almost RM 30 000 on top of the original purchased price. Some purchasers are not able to do so due to financial constraints.

In such a scenario, do we have any rights to demand that the liquidator complete the houses without any additional payments required from purchasers? Should they refuse , what other options do we have ?

I apologize that this email may disturb you but we would be very grateful to hear your opinion

wassalam

Dear Dr

Thank you so much for the prompt reply. I have another few questions if you don’t mind. If the S and P is terminated , I am not sure whether the liquidator will return our money because the title has been transferred .

If the liquidator terminate and give us the half completed house (as is where is basis) , I am not sure how to continue the development on individual basis since it is a Semi D.  I would appreciate your knowledge sharing on such case.

Wassalam

My answer:

Waalaikum salam

I sympathize with your fate.

My advice is this:

If you have an option, you should terminate the sale and purchase agreement and request the liquidator to repay all your moneys paid to the wound up developer. You can apply to the court to terminate sale and purchase agreement and ask the liquidator to repay all you moneys paid to the previous developer. Buy a new completed house. Full stop.

I think the liquidator has no source of money to rehabilitate the project. So that he asked you to top up. He also needs to get profit from the project as fees. If you think that you have adequate patience, please bear with the liquidator to complete the rehabilitation. If not, ie if your feel that this is not worthwhile, terminate the sale and purchase agreement and ask the liquidator to repay back all your moneys.

 This email is my personal opinion and made on without prejudice basis.

All the best.

Assoc. Prof. Dr. Nuarrual Hilal Md Dahlan, UUM, Kedah

If you want the completed house, you have to add up RM 30 k. You have to cooperate with the liquidator in order to complete. Nonetheless, you will be required by the liquidator to sign a waiver letter which states that the liquidator will not be responsible to any liability and faults of the wound up developer company. The waiver letter also may contain a statement that you waive all damages/compensations arising from the losses you suffered due to the abandonment. New S&P agreement may need to be entered into between you and the liquidator. The terms may be different from the original S&P and that your rights may be marginalized in order to protect the interests of the liquidator.

Question: Whether this new S&P has been approved by the Ministry of Housing?

If you are not agreeable to have your abandoned unit be revived due to complications and other troubles, you can/may terminate the S&P and claim for all the moneys paid to the developer, including damages until full settlement. In this case, you also need to file proof of debts and submit it to the liquidator. You will be considered as an unsecured creditor of the wound up housing developer company and may entitle to a refund of all your moneys and other damages.

The question whether the land has been transferred into your name does not matter as the contract imposes the developer to complete the house with vacant possession and with the CCC obtained. Even though the title has been transferred into your name, the developer is still in breach of the contract in that he has not yet completed the house, deliver vacant possession and provide the CCC.

I think in certain circumstance, it is appropriate for you to terminate the S&P and claim for refund and ask for damages. All these must be supported with court judgment.

This advice is made on a without prejudice basis.

 

A New Email on the Grievances of an Abandoned Housing Project Purchaser

Dear En. Hilal,

I read your articles on abandoned housing project. Being very convincing with your expertise in this field, here I would like to get your brilliant  and tips.

Background

My name is…. In 1998, I purchased a unit of apartment in…. This project was ran by …. (the developer) I get into a contract with … (the bank) to finance my purchase of the apartment unit. …had released the 1st 10% of my loan to …(the developer).

In Dec.2002 this project was declared abandoned by KPKT (Ministry of Housing and Local Government). Few years later … (the developer) was declared bankrupt. Few years after the declaration that this project was abandoned, I had requested …(the bank) to close my loan account as I would like to settle all the 1st 10% which was disbursed to…(the developer), envisaging that I want to avoid paying the interest for that 10% for good. The bank told me that was not possible.

In 2006, I went oversea to further study and till now still in oversea. I did not have any contact with the bank anymore. The interest from my housing loans kept on accumulating plus all legal fees, late payment fees and other related fees.

This month Jan 2014, by chance I had contacted the organizing committee of purchasers of…(the developer) project and he told me that the project was taken over by another developer but my unit fall under cancelled project, whereby the developer had received the approval from the court to cancelled the project of my unit and will reimburse all the money the purchasers had spent to buy the unit in that parcel, they will reimburse ONLY the amount that the bank had released to…(the developer) and the 10% down payment, other related cost like lawyers fees for the bank and the developer and related fees will not be included.

I have contacted the related persons from the new developer, and they had informed me that they had released the cheques under my names to…(the bank) and the cheque was cleared in Nov 2013. The bank did not contacted me, I understand because I was not contactable. Then I contacted the person in-charge from the Loan monitoring unit in…(the bank) and they admitted that they had received and cleared the cheque.

I have requested the Bank to reconsider and recalculate the settlement of my debt to…(the bank), and I have also requested them to minus the 5 years waiver exemption of paying the interest for that abandoned project as announced by the Government, and I requested the bank to minus all legal fees too during the 5 years waiver / exemption of paying the interest.

My Questions

  1. Am I correct to request all those 3 issues to be reconsidered for the settlement of my loan with…(the bank) for this abandoned project? If not, could you please advise or suggest me what actually the correct thing to do or to request?
  2. Do I have to provide the Bank with the necessary docs related to this issue? If yes, what are the documents would be?
  3. I have also requested the bank to remit all the balances from that settlement amount to my personal account.

 Below is the draft of my email to the person in-charge in …(the bank). I really appreciate if you could have a look on my drafted email below and please feel free to amend or add any wording if you think necessary/appropriate. I really appreciate if you could give me the feedback ASAP so that I could contacted those persons accordingly ASAP too.

Assalamualaikum …,

As per our discussion on the phone this morning, could you please proceed with the necessary for my below requests pertaining to the settlement of my HL with …(the bank) for the abandoned project under…(the developer).

The Request

  1. I would like to request the waiver of interest exemption as announced by the government for any abandoned project. this waiver should be commenced from the date the project was declared abandoned by KPKT (Kementerian Perumahan dan Kerajaan Tempatan/ Pihak berkuasa yang berkenaan with maximum terms of 5 years.
  2. I would like to request the waiver of all legal fees imposed on this account during that waiver period too with the reasons explained in my previous email.
  3. I would like to request that all the balances from this settlement to be refunded to my …(my bank) account no…………………………………………..

Thanks and kind regards

 My answer…

Assalamualaikum…

I feel sorry for the disaster that strikes you.

This is an opinion regarding your case. Nonetheless, my advice/opinion below is subject to without prejudice basis.

Your housing developer went bankrupt and wound up, leaving the housing project abandoned. In Malaysia, the normal and general possibility that the abandoned housing project can be revived is remote. At the end of the day, you may not get the duly completed house and that you may have to settle the loan that had been advanced to the defaulting abandoned housing developer. Even if you sue the wound up housing developer, this may not help you either. As the remaining funds may not be adequate to compensate you for all the losses you suffer. In this situation, legally, you may apply to the court to lift the corporate veil, requesting the court to order the directors to pay compensation and be liable to you.

On the other hands, you could report to the police for the fraud that the company/director committed. Further, a report should be lodged to KPKT, so that KPKT can take action in accordance with the provisions under the Housing Development (Control and Licensing) Act 1966 (Act 118) against the defaulting directors of the abandoned housing developer company.

In short and by and large in Malaysia, there is no law that governs abandoned housing project, its rehabilitation and that can protect the aggrieved purchasers’ interests today (including obtaining damages and compensation).

As regards your problem (in 2002) on…(the bank) for releasing some percentage of the loan, it is a law that you as the customer has a right to order …(the bank) not to release the loan to the defaulting developer (see Hoo See Sen & Anor v. Public Bank Berhad & Anor [1988] 2 MLJ 170, (Supreme Court)). The act of the bank in releasing the first 10% to the developer, despite your request to them not to do so, was wrong in law and knowing that the project was declared abandoned by KPKT. On this, I think you should provide proof of their negligence and breach of duty as the bank. You should also report this to Bank Negara Malaysia to take action and can sue them for their breach of duty of care/negligence. You may also claim damages/compensation for the losses you suffered.

You are also entitled to get an endorsement and certification from KPKT on your right to have the calculation of the interests of your loan be stopped from the date the housing project has been declared abandoned by KPKT. As regards your right to get back all legal fees and related fees, I think, you have to personally sue the wound up housing developer and by lodging Proof of Debt (POD) to the liquidator and you will become an unsecured creditor who may entitle to the balance moneys that the wound up company left.

In 2013, you said …(the bank) released some loan to the new developer. I cannot imagine, how could the bank release the money to the new developer, if your house has been cancelled for further development? In this case, I think …(the bank) was negligent and breached their duty. You can ask them to cancel the payment made and make a statement that you shall not be liable (to repay/settle the loan) to the wrongful release of that loan to the new developer.

Finally, you are entitled to the requests (waivers) you made to…(the bank). If they still hesitant to entertain your request, you may report to Bank Negara Malaysia for further action. Provide all proof as well.

Before I end this email, I have a question:

Is there any court order regarding the rehabilitation of the project and on the handing over of the project from…(the developer) to the new rehabilitating developer? The court order should provide certain terms as regards the rights of the purchaser to proceed or not to proceed with the rehabilitation, terms that protect the purchasers’ interests etc and the duties of …(the bank).

Good luck

Associate Professor Dr. Nuarrual Hilal Md. Dahlan ACIS, Institute for Governance and Innovation Studies, Universiti Utara Malaysia, Sintok, Kedah Darul Aman.